McEwen Mining (NYSE: MUX) and A-Mark Precious Metals (NASDAQ:AMRK) are both small-cap basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Volatility & Risk

McEwen Mining has a beta of -1.32, meaning that its stock price is 232% less volatile than the S&P 500. Comparatively, A-Mark Precious Metals has a beta of 0.11, meaning that its stock price is 89% less volatile than the S&P 500.

Valuation and Earnings

This table compares McEwen Mining and A-Mark Precious Metals’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
McEwen Mining $54.53 million 16.21 -$11.30 million ($0.02) -141.50
A-Mark Precious Metals $7.40 billion 0.02 $10.53 million $0.97 18.41

A-Mark Precious Metals has higher revenue and earnings than McEwen Mining. McEwen Mining is trading at a lower price-to-earnings ratio than A-Mark Precious Metals, indicating that it is currently the more affordable of the two stocks.

Dividends

McEwen Mining pays an annual dividend of $0.01 per share and has a dividend yield of 0.4%. A-Mark Precious Metals pays an annual dividend of $0.32 per share and has a dividend yield of 1.8%. McEwen Mining pays out -50.0% of its earnings in the form of a dividend. A-Mark Precious Metals pays out 33.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for McEwen Mining and A-Mark Precious Metals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
McEwen Mining 0 0 1 0 3.00
A-Mark Precious Metals 0 1 1 1 3.00

McEwen Mining currently has a consensus price target of $5.00, suggesting a potential upside of 76.68%. A-Mark Precious Metals has a consensus price target of $21.53, suggesting a potential upside of 20.52%. Given McEwen Mining’s higher probable upside, equities research analysts clearly believe McEwen Mining is more favorable than A-Mark Precious Metals.

Insider & Institutional Ownership

29.3% of McEwen Mining shares are owned by institutional investors. Comparatively, 19.9% of A-Mark Precious Metals shares are owned by institutional investors. 26.6% of McEwen Mining shares are owned by company insiders. Comparatively, 43.0% of A-Mark Precious Metals shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares McEwen Mining and A-Mark Precious Metals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
McEwen Mining -9.19% -1.69% -1.51%
A-Mark Precious Metals 0.09% 10.08% 1.40%

Summary

A-Mark Precious Metals beats McEwen Mining on 10 of the 14 factors compared between the two stocks.

McEwen Mining Company Profile

McEwen Mining Inc. is a mining and minerals production and exploration company. The Company is focused on precious and base metals in Argentina, Mexico and the United States. The Company’s segments include Mexico, Minera Santa Cruz S.A. (MSC), Nevada and Los Azules. The Mexico Operations segment includes properties, such as El Gallo 1 mine and the El Gallo 2 project. The MSC segment includes properties, such as the San Jose mine and other concessions located around the mine. The Company’s properties in Nevada segment include Gold Bar project and exploration properties. The Gold Bar project is a proposed mine project. The Los Azules segment includes various properties, such as Los Azules project, Chonchones project, Laganoso project, La Cerrada project and Other Argentina properties. The Los Azules copper project is an advanced-stage porphyry copper exploration project located in the cordilleran region of San Juan Province, Argentina near the border with Chile.

A-Mark Precious Metals Company Profile

A-Mark Precious Metals, Inc. is a precious metal trading company. The Company is a wholesaler of gold, silver, platinum and palladium bullion and related products, including bars, wafers, grain and coins. It distributes gold and silver coins and bars from sovereign and private mints; provides financing for the purchase of bullion and numismatics; offers storage for bullion, and offers complementary products, such as consignment, customized finance and liquidity programs, such as repurchase (Repo) accounts, and trade quotes in a variety of foreign currencies. It operates through various business units for accounting purposes, including Industrial, Coin and Bar, Trading, Finance, Collateral Finance Corporation, Transcontinental Depository Services and Logistics. It is an authorized distributor of gold and silver coins for sovereign mints and various private mints. The sovereign mints include the United States Mint, the Australian (Perth) Mint and the Austrian Mint, among others.

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